Cigna Corp. has become the second health insurer to settle a
class-action lawsuit with some 700,000 physicians nationwide in an
agreement valued at more than $400 million.

In the settlement, Cigna agreed to change its payment practices,
pay physicians at least $85 million, pay as much as $55 million in legal
fees and contribute $15 million to a physicians' charitable
foundation, according to statements from Cigna and the physicians'
attorney, Archie Lamb. Cigna presented time settlement to the court
Sept. 4.

The move, if approved by the court, would end Cigna's
involvement in Shane vs. Humana, a national class-action lawsuit pending
in U.S. District court for the Southern District of Florida before Judge
Federico Moreno. It also resolves a similar case, Kaiser vs. Cigna,
which originally was filed in Illinois state court and then transferred
to federal court in Miami, Cigna said.

Aetna Inc. made a similar settlement in the class action in May.
Other insurers still involved in the pending litigation include
WellPoint Health Networks Inc., Anthem Inc., Humana Inc. and Coventry
Health Care Inc.

"The agreement will streamline communication between
physicians and Cigna, reduce administrative complexity in the claims
payment system and help improve the quality of the health-care delivery
system," Lamb said. As a result of the changes, physicians would be
better able to predict claims payment and reduce time-consuming and
costly administrative burdens, he said.

The dollar-value savings to physicians as a result of the lower
administrative costs could be worth $300 million, bringing time
agreement's total value to more than $700 million, he said.

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